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Tuesday, October 10, 2017

Shale Law Weekly Review - October 10, 2017

The following information is an update of recent local, state, national, and international legal developments relevant to shale gas.

Local Regulation: Federal Court Holds Home Rule Charter to be Preempted by State and Federal Law

On September 29, 2017, The U.S. District Court for the Western District of Pennsylvania invalidated several provisions of the Home Rule Charter for Highland Township, Pennsylvania. (Seneca Res. Corp. v. Highland Twp. et al., No. 16-cv-289). The provisions in the Charter prohibited the injection of wastewater fluid from drilling activities. Seneca Resources Corporation (Seneca) is an oil and gas exploration and production company. Seneca received a permit from the Environmental Protection Agency to operate an injection well. Highland Township declared that the permit was invalid under their Charter, and Seneca initiated this lawsuit. The court held that the Charter was preempted by federal law under the Safe Drinking Water Act and by state law, Act 13.

On October 3, 2017, the U.S. Court of Appeals for the Fifth Circuit denied a landowner’s motion for preliminary injunction in a lawsuit against Trans-Pecos Pipeline, L.L.C. (Boerschig v. Trans-Pecos Pipeline, No 16-50931). The Trans-Pecos Pipeline is a 148-mile natural gas pipeline in Texas operated by Energy Transfer Partners. The pipeline’s route will pass through landowner John Boerschig’s ranch. After negotiations failed, Trans-Pecos began condemnation proceedings under Texas eminent domain law. Boerschig brought this lawsuit arguing that allowing a private company to condemn private property is an offense to due process. The court held that Boerschig was unable to establish a likelihood of success on his constitutional challenge and, therefore, is not entitled to a preliminary injunction against Trans-Pecos.

Pipelines: Ohio Issues Water Quality Permit for NEXUS Pipeline

On September 19, 2017, the Ohio Environmental Protection Agency (Ohio EPA) issued a Water Quality Certification for the NEXUS pipeline. The NEXUS pipeline will be a 255-mile natural gas pipeline delivering 1.5 Bcf/d from eastern Ohio to Michigan. Ohio EPA requires NEXUS to have contingency plans to prevent or manage any unanticipated spills. Ohio EPA has set dates for public hearings in October and will take public comment for the next 30 days.

Public Lands: Court Holds BLM Does Not Have Authority to Delay Natural Gas Venting Rule

On October 4, 2017, the U.S. District Court for the Northern District of California granted the plaintiff’s motions for summary judgment in the lawsuit over the Bureau of Land Management’s (BLM) rule, Waste Prevention, Production Subject to Royalties, and Resource Conservation (Sierra Club, et al. v. Zinke, et al, 17-cv-03804-EDL). The purpose of the rule was to reduce natural gas waste from venting, flaring, and leaks resulting from oil and gas activities on Federal and Indian leases. California, New Mexico, and the Sierra Club sued BLM when they attempted to postpone compliance for the rule. The court here vacates the Postponement Notice and held that BLM did not have the authority to postpone the rule. In response, on October 5, 2017, BLM proposed to suspend or delay the rule to avoid industry costs because the rule may be rescinded or revised. Comments on this proposed rule will be accepted until November 7, 2017.

On October 3, 2017, the Scottish government announced that it will not support the continued use of hydraulic fracturing for the development of oil and gas. In January 2015, the Scottish government put in place a moratorium on allowing new oil and gas development in the country, pending a public consultation. The public consultation, Talking ‘Fracking’: A Consultation on Unconventional Oil and Gas - Analysis of Responseswas released on October 3, 2017. After analyzing the results, the government concluded that “the overwhelming majority of respondents were opposed to the development of an unconventional oil and gas industry in Scotland.”

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The Center for Agricultural and Shale Law (CASL) provides information and educational programs on agricultural and shale law and policy for producers and agribusinesses, attorneys, government officials, and the general public. The Center does not provide legal advice, nor is its work intended to be a substitute for such advice and counsel.